Smith, Dr. Laila2019-09-252019-09-252011-06-202000http://hdl.handle.net/20.500.12424/179295"Local authorities across South Africa have undergone enormous transformation in the post-apartheid period. Ten years into democracy, most local authorities are contending with the difficulties in providing and improving the quality of water and sanitation services to recently amalgamated areas that historically received none or an abysmal quality of service. The national policy guidelines driving local authorities uphold several important equity principles such as a free allocation of basic water services and in manner that is developmental, i.e.: that the manner in which services are delivered is inclusive and participatory. Local authorities are struggling to put these principles into practice as the finance and human resource constraints they are facing often lead them to put efficiency objectives in the forefront, with the hope that the equity issues will be dealt with down the line. The patience of service users in historically disadvantaged areas is, however, wearing thin, given that the country is 10 years into its democracy and the fruits of what has been delivered can appear negligible to them. The City of Johannesburg is the financial epicentre of the country and has some of the highest concentration of skills in the country. Despite this abundance, Johannesburg City Council is confronted with high levels of inequality and poverty amongst the population it serves and is still struggling with how to balance equity and efficiency objectives. As part of a major restructuring process in the late 1990s that was driven by the Igoli 2002 model, the city corporatized 14 public functions in 2001 in order to devolve operations to separate companies. The intention was to improve on the efficiencies of how these core services were run. The City remains the owner of Johannesburg Water, pty, (JW) and delegated its shareholder responsibilities to an appointed board of directors. The Contract Management Unit was set up as an in-council multi-sectoral monitor to oversee the service delivery standards of Johannesburg Water, along with its 13 other sister companies. The teething problems associated with this corporatization model are rooted in the governance of this institutional arrangement. First, the autonomy of Johannesburg Water is limited by the shared services it has had with the city, such as billing, credit control and meter reading functions for the bulk of the city’s residents. The inability of JW to take control over these functions undermined its ability to deal with critical areas related to improving the revenues of the company. The city has learnt an expensive lesson in retaining functions that it itself has been unable to improve and as such, is only now beginning to transfer the revenue functions over to JW. Second, the authority of the Contract Management Unit, as a quasi-regulator is limited by remaining within the City Council. While the CMU benefits from the proximity to political councillors, it is nevertheless constrained in passing judgement on the behaviour of Johannesburg Water because it must navigate through numerous political and bureaucratic sensitivities. Third, in the first few years of operation, the capacity of the regulator was limited by virtue of the City not placing enough importance on this regulatory function, perhaps because it felt that it still ultimately owned the Corporatized entities. The CMU capacity problems were rooted in a lack of human or financial resources to operate effectively. These difficulties were compounded by information asymmetries related to the bulk of the sectoral expertise migrating to Johannesburg Water when it was created. The outcome of this situation has left a vacuum of specialized knowledge within the city, a necessary feature for providing effective oversight."(pg 3)engWith permission of the license/copyright holderwaterpublic goodcorporationsEconomic ethicsEthics of economic systemsLabour/professional ethicsTechnology ethicsConsumer ethicsPreprint